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“Caregivers should never have to choose between caring for a loved one and financial stability,” Sen. Gillibrand said.
By Forum Staff
Senator Kirsten Gillibrand (D-N.Y.) noted that she joined Senate colleagues on Thursday to announce legislation that would help caregivers who left the workforce receive retirement compensation through Social Security credits.
According to Gillibrand, the Social Security Caregiver Credit Act is needed because today, more than one in five Americans are currently involved in family caregiving to loved ones who are ill, disabled, or elderly, and tens of millions of Americans leave the workforce entirely or reduce their hours significantly to care for loved ones at some point in their career. Studies indicate that, on average, income losses due to caregiving total more than $300,000, threatening retirement security. Women, who make up two-thirds of unpaid caregivers, are disproportionately impacted, and more than two million women have left the U.S. workforce since the pandemic began. The legislation would be a first step toward providing much-needed financial relief for caregivers across New York, Gillibrand said. According to the National Academies of Science, Engineering, and Medicine, caregivers of an elderly loved one spent more than 250 hours a month providing care. In 2017, 2.5 million caregivers in New York provided approximately $31 billion and 2.1 billion hours in unpaid care, according to an AARP report.
Highlights of the legislation:
- The bill creates a Social Security earnings credit to caregivers who leave the workforce or reduce their hours to care for a relative.
- The credit would be added to earnings to calculate total deemed wages, which would be used to determine future benefits.
- The credit is progressive, varying on an income-based sliding scale.
- Those individuals who do not have an income could receive a maximum credit, equal to half the average national earnings.
- The credit would decrease in value until it is phased out for those who make the average national wage or more (in 2019, it was $54,099.99).
Eligibility:
- This credit is available for anyone who spends at least 80 hours per month providing care to a dependent relative under the age of 12 or a chronically dependent individual.
- A dependent relative or chronically dependent individual qualifies as a child, grandchild, niece, nephew, parent, grandparent, sibling, aunt, uncle, spouse, or domestic partner of the caregiver.
- A chronically dependent individual is a person who cannot perform daily living activities such as eating, bathing, toileting, and dressing without the assistance of a caregiver.
- The caregiver credit could be claimed for up to five years, and is retroactive to allow for months prior to enactment.
“Caregivers should never have to choose between caring for a loved one and financial stability,” Gillibrand said. “The Social Security Caregiver Act would help legitimize the essential work caregivers provide by ensuring they have access to critical Social Security benefits and a stable retirement plan. I am proud to support this common-sense legislation that will provide much-needed financial relief and put Social Security benefits in the hands of caregivers.”
